After nearly a year under chapter 11 protection, home builder American West Development Inc. won court approval to exit bankruptcy, the Las Vegas Review-Journal reported on Saturday. Bankruptcy Judge Mike Nakagawa on Friday overruled objections to a fund that will cover construction defect claims and approved the company's bankruptcy reorganization plan. As a result of a bargain reached with lenders before the case began on March 1, 2012, American West’s debt, $162 million, will be reduced to $49.6 million, reflecting the shrunken value of the Las Vegas-based home builder. The banks agreed to give up their claim to a $112.4 million shortfall, creating the financial room to repay small creditors without any collateral. In court papers filed last month, American West president Robert Evans estimated they could receive as much as 80 percent of the $2.3 million they are owed.
